ECON 002 Lecture Notes - Lecture 1: Empiricism, Budget Constraint, Opportunity Cost

50 views2 pages
5 Aug 2016
School
Department
Course
Professor

Document Summary

Economic agent an individual or group that makes a choice. Scarce resources things that people want, where the quantity demands exceed the quantity supplied. Scarcity exists because people have unlimited wants in a world of limited resources. Economics is the study of how agents choose to allocate scarce resources and how those choices affect society. Positive economics analysis that generates objective descriptions or predictions about the world that can be verified with data. Normative economics -- analysis that prescribes what an individual or society ought to do: almost always depends on subjective judgments (feelings, tastes or opinions) Three principles of economics: optimization trying to choose the best feasible option given the available information. Must weigh the potential risks in a decision. If agents fail optimize, normative economics analysis can help them realize the mistakes and make better choices. Trade-off when the economic agent needs to give up one thing to get something else.

Get access

Grade+20% off
$8 USD/m$10 USD/m
Billed $96 USD annually
Grade+
Homework Help
Study Guides
Textbook Solutions
Class Notes
Textbook Notes
Booster Class
40 Verified Answers
Class+
$8 USD/m
Billed $96 USD annually
Class+
Homework Help
Study Guides
Textbook Solutions
Class Notes
Textbook Notes
Booster Class
30 Verified Answers

Related Documents

Related Questions